Nakheel not planning to sell any assets: Chariman

Has succeeded in pruning trade claims by 85 per cent

Nakheel’s Chairman has said the company is not planning to sell any assets as it is now a profitable entity and has succeeded in pruning trade claims by 85 per cent.

In an interview to Gulf Business magazine this week, Ali Rashid Lootah said: “We were supposed to sell some assets in 2008, but we managed to defer that.

“My aim is not to sell, not to divest. We will increase our income from other sources – from selling land, new residential developments, more income from retail and leasing – to avoid it.”

He further stated: “We have shown the government that we have made a good decision and that proof is that we are profitable again. It’s real profit, it’s cash profit. That makes the difference.”

Last year in September, the chairman told reporters that the company had no plans to sell any assets.

Nakheel, the magazine said, had settled Dh3 billion out of a total claim of Dh8bn from creditors and had saved 85 per cent on claims.

"The remaining big boys, they put the big figures, but we're confident it will be about the same [reduction]," Lootah said.

"We expect to bring it down to not exceeding Dh1bn total. We're patient. I'm not in a hurry to pay - if they want to settle, they have to be reasonable."

In May, Emirates 24|7 reported quoting the planned sovereign bond prospectus that Nakheel had used only 41.5 per cent, or Dh11.15 billion, from a total commitment of Dh26.78bn by the Dubai Financial Support Fund (DFSF) and had managed to slash trade claims down by 70 per cent to Dh17.61bn from Dh59.32bn.

“As at March 31, 2012, the total amount of funding invested by the DFSF (directly or indirectly) in Nakheel pursuant to the Nakheel restructuring was approximately Dh11.15bn, from a total commitment of Dh26.78bn,” according to information stated in the planned sovereign bond prospectus.

It reported a net profit of Dh767m (US$208.82m) in the first six months of 2012, up from Dh562m same period last period.

Revenues jumped to Dh3.1bn in the first half, up 112 per cent from the corresponding period last year.

Nakheel said in the planned sovereign bond prospectus, that it continues to offer customers that remain invested in suspended, cancelled and longer-term projects the option of receiving an assignable credit (equivalent to 100 per cent of their installment payments) and the option to exchange their unit in such projects for a unit in an ongoing project at current market values, the prospectus mentions.

Those customers invested in suspended, cancelled and longer-term projects that do not want to exchange their unit for a unit in a project nearing completion will either move onto a revised payment schedule in respect of their unit, or hold their assignable credit until March 31, 2015.

Customers may also to exchange their credit during this period for property in a near-term project, but customers still holding credits on March 31, 2015 will be given cash equal to the face value of that credit.

Nakheel has 100 per cent occupancy in Ibn Battuta Mall and Dragon Mart. Residential leasing showed remarkable improvement with occupancy levels touching 80 per cent across its portfolio of 20,000 units. The developer plans to deliver over 8,000 units by year-end and early 2013.